"EUR risk remains biased to further downside, given the massive divergence to yield spreads and the acceleration observed in bearish momentum indicators".

"Friday’s decline also highlights further downside risk to EUR given the negative reaction to Russia-related headlines, a reversal from the typical pattern observed since March. The reaction was likely the result of a focus on the consideration of escalating EU sanctions toward Russia with public officials voicing their support in spite of economic costs".

"Near term risk lies with broader developments, with no high level data scheduled for release before Wednesday".

"Both trend and momentum indicators are suggestive of further downside, however we note that the RSI has entered oversold territory between 20 and 30. Key downside levels include 1.3400 and the November 2013 low at 1.3296".